In more than 40 episodes spanning 75 years, equity and bond fund investors have defied predictions that they would panic and spark crises. Yet banking regulators won’t let go of their “run” scenario. Why?

Time for UK parliament to step up to preserve Britain’s reputation

BERLIN — Since the U.K.'s EU referendum it has been my job as business secretary to work with companies and investors to convince them to keep faith with Britain. In doing so, I always make two main arguments.

The first is that Britain’s fundamental attractions are strong and getting stronger. We are an entrepreneurial economy, with world-beating creative and scientific talent and flexible, competitive markets. Through our modern industrial strategy we are building on those strengths — for example with the biggest increase in R&D that Britain has ever had in our history, and a national focus on the technological grand challenges that are sweeping the world and in which Britain enjoys a commanding position.

The second is that we are, and always will be, the pragmatic, open, pro-enterprise and dependable nation that the world has always considered us to be. That means, of course, that the U.K. government would always want to secure a cordial relationship with the EU that continues our ability to trade free of tariffs and unnecessary impediments.

On the whole, these arguments have proved reassuring. For example, of the five big competitive automotive investments up for grabs since the referendum, we have secured every one. Last month the global life sciences sector committed more than £1 billion of new investment in Britain on the back of our industrial strategy.

But no one should assume that investors have been relaxed about Brexit. In every case, in meetings and conversations from the United States to the Far East, I have constantly had to deploy both arguments.

In recent weeks, confidence from investors has been shaken. Debates in the U.K. parliament are monitored closely, and with mounting alarm, in boardrooms around the world. The dire prospect that we could tolerate trading with our largest and closest market on WTO terms — the most rudimentary that exist between any nations on earth — is bewildering to them. And when hundreds of millions of pounds are having to be diverted by companies from productive investments into defending themselves against the risk of a no-deal exit from the European Union — through piling up stocks, renting warehouses and planning shutdowns of production — investors have every right to object.

Most worrying to investors is the signal that Britain, after 40 years of being a reliable and confident place in which to do business, may be embarking on a previously unimagined era in which some are prepared to contemplate policies that would harm our economy and the businesses that have made us their home, whether those policies are to crash out of the EU without agreement or to follow the hard-left program put forward by the Labour Party.

We can’t go on like this. January 2019 must be the month in which parliament — for so long a source of strength for our international reputation — resolves how we will act together as a nation and give confidence to business.

Business has been supportive of the agreement the prime minister has negotiated because it reflects what job creators say is needed. A deal, rather than no deal. A transitional period to a new relationship, rather than a cliff edge. And the prospect of continuing a close trading relationship that avoids friction at the border that would be so damaging to just-in-time processes. Much has been made of the backstop, but it does carry the big advantage that Britain could never in future be forced onto WTO terms of trade whether by the EU or by being timed out, as the ticking clock of Article 50 entails.

That is why I strongly believe parliament should support the deal. MPs must act not simply as critics, but as responsible participants in making the most important decision that they may ever take. I believe parliament should move quickly and act responsibly to establish what will, and will not, command support.

Parliament can establish that it wants a no-deal Brexit to be ruled out. Most MPs, across the House, including many in government, would not countenance leaving on March 29 with no agreement.

Once that was clearly demonstrated, then parliament could make a clearer choice of how to proceed. It is not sufficient to record a disapproval of no deal — a further step would need to be taken to prevent it happening by default. This is a time for parliament to come together and work intensively to establish an agreement that can command majority support, recognizing that the deal that has been negotiated, if its terms had been considered dispassionately at almost any time before or after the referendum, would be regarded as clearly leaving the European Union while maintaining the close relationship with our nearest neighbors on which our prosperity depends.

Business has been quite clear that it prefers the certainty of a good deal to an extended debate about the terms of Brexit. It wants the deal to pass. From my dealings with businesses — small and large, British and international — I know that most place as the greatest priority preventing an unintended and deeply damaging rupture in just under 80 days' time.

In that, the needs of the economy, the livelihoods of millions and the views of most MPs are aligned. Now is the time for parliament to act on it.

Greg Clark is the U.K. secretary of state for business, energy and industrial strategy.